COMMON CHALLENGES SMALL AND MEDIUM ENTERPRISES (SMEs) FACE WHEN IMPLEMENTING AND USING ERP

1. Challenges Before Implementing ERP

Mainly caused by insufficient preparation, unclear needs assessment, and limited resources.

• Unclear business needs & internal processes
  SMEs often have not standardized their workflows (inventory, sales, accounting, production, etc.). As a result, once ERP implementation begins, they discover fragmented data and overlapping procedures, which require time-consuming adjustments.

• Lack of internal IT or business process owners
  Many companies outsource everything to software developers without assigning an internal “project owner,” making it difficult to control scope and features. This often leads to mismatches with actual needs and additional costs for modifications.

• Underestimating budget & timeline
  SMEs frequently expect a fast and inexpensive rollout. However, when customization, training, or system integrations are needed (accounting, sales, website, RS232 electronic scales, POS, etc.), hidden costs arise.

2. Challenges During ERP Operation

Issues that surface once the ERP goes live.

• Inconsistent or inaccurate data
  Poor initial data validation, along with unsanitized Excel files, results in incorrect reports and unreliable decision-making.

• Complex and difficult-to-use interface
  Employees are unfamiliar with the system and insufficiently trained; the ERP’s “global standard” interface may not fit local business culture or workflows.

• Over-reliance on vendors
  Many SMEs lack IT staff who can develop or maintain the system. Every small change (adding reports, integrating payment gateways, e-invoices, supplier or customer data, etc.) requires outsourcing. This is why it’s critical to choose a reliable and long-term ERP partner from the start.

• System slowness or instability
  Choosing cheap cloud plans or weak server configurations can cause lags or downtime, especially when user numbers increase rapidly.

• Lack of integration with other software
  For example: no connection to e-commerce websites, CRM marketing tools, payment gateways, or RS232 electronic scales in warehouses — forcing manual data entry and increasing errors.

3. Challenges in Management & People

Mostly related to culture, habits, and organizational change.

• Employee resistance to change
  Staff accustomed to Excel or manual bookkeeping may resist entering complete data or try to bypass the ERP system.

• Lack of clear policies & usage discipline
  No clear processes on who enters, approves, or views reports. Without defined accountability, data becomes fragmented, incomplete, or inaccurate, leading to unreliable reports.

• No ongoing evaluation & improvement
  Many companies believe ERP is a “one-and-done” project. They fail to restructure or update modules as the company grows, making the system outdated and unable to meet evolving needs.

???? Solutions from ENGMA (ERP Development & Implementation Specialist)

To address these common issues, ENGMA recommends the following strategies for SMEs planning to adopt ERP:

1. Define core needs — start with essential modules (Accounting, Sales, Inventory, CRM) instead of going “all-in-one” from the beginning.
   → This reduces risk, saves costs, speeds up deployment, keeps data clean, and helps employees gradually adapt to the ERP system.

2. Standardize data & internal processes before migrating to ERP.
   This step is crucial but often overlooked when companies leave it entirely to software developers. It’s important to review and optimize workflows first to avoid “dirty data,” redundant processes, incorrect reporting, and unnecessary programming costs.

3. Choose an experienced ERP provider familiar with SMEs and the Vietnamese market (e-invoicing, tax, POS, RS232 integration, etc.), with proven reliability and long-term support.

4. Continuous evaluation & improvement:
   Regularly review and refine processes, fix issues discovered during operation, and adapt the system to evolving business needs.